Theory-of-Mind (ToM) is a fundamental psychological capability that allows humans to understand and interpret the mental states of others. Humans infer others’ thoughts by integrating causal cues and indirect clues from broad contextual information, often derived from past interactions. In other words, human ToM heavily relies on the understanding about the backgrounds and life stories of others. Unfortunately, this aspect is largely overlooked in existing benchmarks for evaluating machines’ ToM capabilities, due to their usage of short narratives without global context, especially personal background of characters. In this paper, we verify the importance of comprehensive contextual understanding about personal backgrounds in ToM and assess the performance of LLMs in such complex scenarios. To achieve this, we introduce CharToM-QA benchmark, comprising 1,035 ToM questions based on characters from classic novels. Our human study reveals a significant disparity in performance: the same group of educated participants performs dramatically better when they have read the novels compared to when they have not. In parallel, our experiments on state-of-the-art LLMs, including the very recent o1 and DeepSeek-R1 models, show that LLMs still perform notably worse than humans, despite that they have seen these stories during pre-training. This highlights the limitations of current LLMs in capturing the nuanced contextual information required for ToM reasoning.

In a systematic way, we investigate a widely asked question: Do LLMs really understand what they say?, which relates to the more familiar term Stochastic Parrot. To this end, we propose a summative assessment over a carefully designed physical concept understanding task, P HYSI C O. Our task alleviates the memorization issue via the usage of grid-format inputs that abstractly describe physical phenomena. The grids represents varying levels of understanding, from the core phenomenon, application examples to analogies to other abstract patterns in the grid world. A comprehensive study on our task demonstrates: (1) state-of-the-art LLMs, including GPT-4o, o1 and Gemini 2.0 flash thinking, lag behind humans by ∼40%; (2) the stochastic parrot phenomenon is present in LLMs, as they fail on our grid task but can describe and recognize the same concepts well in natural language; (3) our task challenges the LLMs due to intrinsic difficulties rather than the unfamiliar grid format, as in-context learning and fine-tuning on same formatted data added little to their performance.